PIN IT

5/05/2010

Fix Your FICO free

A high FICO score can secure a good loan, a great job, or standard rate insurance. The Privacy Act is supposed to help us keep our information quiet, but your score is available to many more than you know. Did you know mailing lists may be compiled by your score?

FICO score is a computer analysis of the following items: Payment history 35%, Amounts owed 30%, Length Time of Credit History 15%, Types of Credit in Use 10%, and New Credit 10%. Lowest number score is 300 and highest is 850. You don’t need to know who invented the computer model or who owns Fair Isaac (call me if you do). There also are Vantage Score, Trans Risk, and Score X, (branded models not yet used much by Lenders).

To improve your score get a full merged report with all three reports,” Credit Cops": Equifax, Experian and Trans Union. Each of these companies may report your information differently, and therefore you will have three scores. You are entitled to free credit report once a year from: annualcreditreport.com however you are not entitled to Free scores. Do not go to Free credit report.com or any scam company that loops you into billing monthly and fails to release the monthly credit card bill. Trans Union, Equifax and Experiam offer websites direct as well. They do not advertise on television, they do not need to.

Review trade items on each report. Derogatory items are at the top of the report. The name of creditor and account number (often shy four digits for security) show for each. Below the account name is available line and payment history. The history also may show as a time line calendar below in reverse order as line ticks.

If anything is incorrect, you begin your letter writing campaign. Write; do not call, to each individual creditor. In the letter include: Your name, home address, the account number, today's date, the reason why you dispute what shows and sign the letter. Be simple for example: Dear Bank of America: I never was late on 4/2009 here's a copy of my cancelled check...The letter does not have to be perfect- it has to be done and in the mail. Do not include your telephone number you want a written response.

Make a folder with a time line on the front. Day one sent letter asked for response in ten days. If they fail to answer in thirty days you are going to write and mail follow up letters. Include in the letter that you wrote them asking to correct the inaccurate item on x date and they failed to respond in thirty days. Also include that they are required by the Fair Credit Reporting Act to investigate and they failed to do so. You may also state you intend to file a complaint with the FTC. You want them to send you a letter deleting the item and to correct the information they report to all credit companies. Once you have the letter deleting the item forward to Equifax PO BOX 740241 Atlanta GA 30374-1111, EXPERIAN PO BOX 2104 Allen TX 75013, TRANS UNION PO BOX 390 Springfield PA 19064.

Tips on raising your score:

Pay everyone on time. Get delinquent accounts current now first and pay the minimum on the remaining accounts. Keep revolving balances 68.9% below the available line. Do not use Finance Companies. Do not open accounts with furniture/ mattress/computer stores that promise 90 days no payment as is sold to a finance company. These types of accounts lower your score. If you have finance accounts pay it off.

Do not allow car dealers to shop a loan for you and add needless inquiries to your score. Don’t sit there and hand them your driver’s license, bring a copy of the license and say I am not required to give you m social security number to test drive a car. Do not close accounts - just pay them off. Do not use disreputable Consumer Credit Counseling companies- they often allow late payments to roll and interest and balances to grow. Do not fall prey to anyone who claims you can buy a new social security number. Do not pay huge fees to credit repair companies who won't work as hard as you can on your own letter writing campaign. Anything that sounds too good to be true like “we can erase $10000 of your credit card debt with the new Obama bill” is too good to be true. Negotiate with all collection companies to delete the disputed item in exchange for paying part or all of it.

Opt out of all junk mailing lists. Be ever so careful entering your private information on any website. Do not use matching passwords with easy to guess tags. The internet is a wonderful place but not everyone on there is who they say they are.